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Importers cooperate to absorb impact of extreme weather
Rain brought an early end to the mango season of Ivory Coast. Peruvian export halted due to rain and landslides. In January, Spain was hit by extreme cold, followed by extreme heat in June. According to the models of meteorologists, we should take more changeable weather into consideration as a consequence of climate change. How do importers see the future and how do they prepare to guarantee stable supply despite weather extremes?
“Our import from some countries was made more difficult because of the fickle weather in South America, especially in Peru,” says Jan Vermeiren. The Belgian importer is specialised in exotic fruit and vegetables. About the situation in Peru, Jan says: “There were so many thunderstorms and landslides, certain regions had no supply at all sometimes. As a consequence, fewer mangoes were available, for example.”
Early end to season
Supply of passionfruit from Colombia was also limited in the months of April and May, just as supply of pineapple from Costa Rica in March and April. “That was also caused by bad weather,” Jan explains. “Supply was limited for five weeks, and prices rose sharply because of that. The changeable weather in Peru, Colombia and Costa Rica definitely caused cuts in supply, but it’s the art of importers to have product when supplies are limited.” The effects of El Niño mostly limited supply in Latin America. As a consequence of the weather phenomenon, much rain fell in regions that are normally dry, and it was dry in regions that normally see much rain.
The mango season in Ivory Coast ended earlier this year, because of rain in the West African country. Mangoes can only be exported when the weather’s dry. As soon as it becomes too damp, risks of fruit flies are too high, and the EU closes its borders. Mexico managed to absorb the drop in supply from Ivory Coast, and bridged it until the start of the season in Senegal.
Rising price creates opportunities
Importers have various options for dealing with similar situations. When there are shortages, prices rise, creating opportunities. Jan explains that when, for example, there’s a shortage of pineapple per container, they can choose to import pineapple by air from, for instance, Colombia. “As fresh produce importer, we also have to work with various shipping agents and various supply countries to always ensure a minimum supply,” Jan continues.
“On the other hand, there’s so much production in various regions and countries that it can be taken care of,” Jan nuances. “However it is important to think proactively, as well as doing a test-run when going to another country, but also that we know where the alternatives are.” The Belgian importer therefore works with importers from other European countries. “If a direct line from us disappears due to weather circumstances, we can take up with colleague importers,” Jan explains. According to him it’s important to work together as importers and help each other out if possible and if necessary as well.
Cooperating with other importers
“We have often done so with importers in Madrid and Barcelona. They are naturally in a critical situation because of the economic aspect in Spain, so it doesn’t take much for them to have an oversupply,” Jan says. “Those importers have also started looking further than just the domestic market.” When there are shortages on the market, prices increase sharply, and it can then become interesting to drive the products that first arrive in Madrid or Barcelona to northern Europe. Perviously, that was ‘not done,’ but in recent years that situation has changed. “Europe is becoming smaller and smaller in that way.”
Jan has been in the trade for thirty years. Because of that, he has built himself a network in Europe, and he knows the most important importers in Paris, Madrid, the Netherlands and Germany. “I immediately know who to call when I have shortages. You once met those people, you have the same suppliers, and you meet each other at the Fruit Logistica, for example.” For certain products, they cooperate year-round, because that’s beneficial to both importers. For example, importing four pallets from Brazil by air is relatively more expensive than importing ten pallets by air. “The cargo becomes cheaper, so it can be attractive to cooperate with importers from various countries.”
In other situations it’s possible to use the importer’s own network to absorb fluctuations within the volumes. Exofi has four flights from Kenya with products such as haricots and legumes. When that supply is too low, the company switches to import from Zimbabwe. The same is true for Colombian passionfruit. When there’s no supply of this fruit, Exofi imports the tropical fruit from Kenya or Zimbabwe. “Products always have various supply options,” Jan says. “An importer’s know-how means we can respond to these kinds of situations. Otherwise our jobs would disappear.”
Extreme weather closer to home as well
Importers are taking into account that weather extremes will happen more often in future. “We’re also seeing it in Europe,” Jan says. He exemplifies, using stone fruit. Normally, the season starts with supply from Seville, followed four weeks later by Murcia, and another four weeks later the north of the country closes the season. Because of the extremely hot weather in June, all regions entered the market at the same time. “Everything arrives at the same time,” Jan says, “When you harvest stone fruit in 45 degrees Celsius, it doesn’t have a long shelf life. They have to harvest, and it comes here, and then you have an oversupply, with all of its consequences.” For years the importer has been working with various companies in Spain in order to have a good stone fruit supply during the season. That all regions had product at the same time in June was exceptional.
The weather in the Netherlands and Belgium also had consequences for the market. In the final weeks of June, temperatures reached more than 30 degrees Celsius. The heat plan was implemented, and the first tropical night was measured. However, fruit consumption dropped. “Less fruit is eaten when it’s more than 25 degrees Celsius,” Jan knows.
What does the future hold? “It’s an art to deal with climatological circumstances, and to work with various shipping agents and origins.” Collegiality among importers has also improved in recent years. “We’re all working with programmes, and when you help someone when they’re in trouble, you can also ask them for help.”
Publication date: 9/21/2017
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